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ACT ON THE PROMOTION OF THE DEVELOPMENT, USE AND DIFFUSION OF NEW AND RENEWABLE ENERGY

Amended by Act No. 10253, April 12, 2010

Article 1 (Purpose)

The purpose of this Act is to contribute to the preservation of the environment, the sound and sustainable development of the national economy, and the promotion of national welfare by diversifying energy resources through the promotion of technological development, use, and diffusion of new energy and renewable energy, and the activation of new energy and renewable energy industries, and by promoting the stable supply of energy, environmentally friendly conversion of the energy structure, and the reduction of greenhouse gas emissions.

[This Article Wholly Amended, Apr. 12, 2010]

Article 2 (Definitions)

The definitions of terms used in this Act shall be as follows:

1. The term "new energy and renewable energy" (hereinafter referred to as "new and renewable energy") means energy resources converted from existing fossil fuel resources or renewable energy sources, including the sun, water, geothermal heat, precipitation, and bio-organisms, which fall under any of the following items: (a) Solar energy;

(b) Bio energy converted from biological resources, which falls within the criteria and range prescribed by Presidential Decree;

(c) Wind power;

(d) Water power;

(e) Fuel cells;

(f) Energy from liquefied or gasified coal, and from gasified heavy residual oil, which ACT ON THE PROMOTION OF THE

DEVELOPMENT, USE, AND DIFFUSION OF

NEW AND RENEWABLE ENERGY

204 Ministry of Government Legislation

falls within the criteria and scope prescribed by Presidential Decree; (g) Energy from the ocean;

(h) Energy from waste treatment, which falls within the criteria and scope prescribed by Presidential Decree;

(i) Geothermal energy;

(j) Hydrogenous energy; and

(k) Sources of energy prescribed by Presidential Decree, other than petroleum, coal, nuclear power, or natural gas;

2. The term "new and renewable energy facilities" means the facilities producing or utilizing new and renewable energy, which are set forth by Ordinance of the Ministry of Knowledge Economy;

3. The term "new and renewable energy power generation" means the generation of electricity by utilizing new and renewable energy; and

4. The term "operator of a new and renewable energy power generation business" means a business operator carrying out a new and renewable energy power generation business who is an operator of an electric power generation business under subparagraph 4 of Article 2 of the Electric Business Act, or an installer of electric installations for private use under subparagraph 19 of the same Act.

[This Article Wholly Amended, Apr. 12, 2010]

Article 3 Deleted

Article 4 (Policy and Encouragement, etc.)

(1) The State shall devise a policy for the promotion of technological development, use, and diffusion of new and renewable energy.

(2) The State shall encourage, protect, and foster the voluntary technological development, use, and diffusion of new and renewable energy by local governments, public institutions under Article 2 of the Act on the Management of Public Institutions (hereinafter referred to as "public institutions"), and enterprises, etc. [This Article Wholly Amended, Apr. 12, 2010]

Article 5 (Establishment of Basic Plan)

(1) The Minister of Knowledge Economy shall formulate a basic plan for the promotion of technological development, use, and diffusion of new and renewable energy Laws on Green Growth, and Economic Investment in Korea 205 04_LawsConcerningGreenGrowth

(hereinafter referred to as "basic plan") through deliberation by the New and Renewable Energy Policy Council referred to in Article 8, after consulting with the head of the appropriate central administrative agency. (2) The basic plan shall be for a period of at least ten years and address the following matters:

1. Objectives and duration of the basic plan;

2. Objectives of the technological development, use, and diffusion of new and renewable energy by energy source;

3. The target ratio of new and renewable energy power generation to total power generation;

4. Greenhouse gas emission reduction targets under subparagraph 10 of Article 2 of the Energy Act;

5. Method of implementation of the basic plan;

6. Assessment of the technological level, the prospects for diffusion, and the expected effects of new and renewable energy;

7. Support schemes for the technological development, use, and diffusion of new and renewable energy;

8. Plans for training experts in the field of new and renewable energy; and

9. Other matters deemed necessary by the Minister of Knowledge Economy to achieve the objectives of the basic plan.

(3) The Minister of Knowledge Economy may modify the basic plan, if deemed necessary in the light of technological developments in new and renewable energy, changes in the supply and demand conditions of energy, or other circumstances, through deliberation of the New and Renewable Energy Policy Council referred to in Article 8, after consulting with the head of the appropriate central administrative agency. [This Article Wholly Amended, Apr. 12, 2010]

Article 6 (Yearly Implementation Plan)

(1) The Minister of Knowledge Economy shall, in order to achieve the objectives specified in the basic plan, devise and execute an implementation plan for each year on the technological development, use, and diffusion of new and renewable energy and the supply of electricity generated by new and renewable energy power generation for each type of new and renewable energy sources (hereinafter referred to as "implementation plan").

206 Ministry of Government Legislation

(2) Where the Minister of Knowledge Economy intends to formulate and perform an implementation plan, he/she shall consult in advance with the head of the appropriate central administrative agency.

(3) Where the Minister of Knowledge Economy has formulated an implementation plan, he/she shall give public notice thereof.

[This Article Wholly Amended, Apr. 12, 2010]

Article 7 (Prior Consultations on Plans for Technological Development, etc. of New and Renewable Energy)

Where a State agency, local government, public institution, or other entity prescribed by Presidential Decree intends to formulate and implement a plan for the technological development, use, and diffusion of new and renewable energy, he/she shall consult in advance with the Minister of Knowledge Economy, as prescribed by Presidential Decree. [This Article Wholly Amended, Apr. 12, 2010]

Article 8 (New and Renewable Energy Policy Council) (1) For the purpose of deliberating on important matters concerning the technological development, use, and diffusion of new and renewable energy, the New and Renewable Energy Policy Council (hereinafter referred to as "Council") shall be established within the Ministry of Knowledge Economy.

(2) The Council shall deliberate on the following matters:

1. Matters on the formulation and alteration of the basic plan: Provided, that any alteration in insignificant matters prescribed by Presidential Decree, among the details of the basic plan, shall be excluded;

2. Important matters concerning the technological development, use, and diffusion of new and renewable energy;

3. Matters on the standard price for electricity supplied by new and renewable energy power generation, and its alterations; and

4. Other matters deemed necessary by the Minister of Knowledge Economy. (3) The composition and operation of the Council and other necessary matters shall be prescribed by Presidential Decree.

[This Article Wholly Amended, Apr. 12, 2010]

Laws on Green Growth, and Economic Investment in Korea 207 04_LawsConcerningGreenGrowth

Article 9 (Funding Project for Technological Development, Use, and Diffusion of New and Renewable Energy)

The State shall appropriate in its budget for each fiscal year the project funds needed to perform an implementation plan.

[This Article Wholly Amended, Apr. 12, 2010]

Article 10 (Use of Project Funds)

The Minister of Knowledge Economy shall use the project funds obtained pursuant to Article 9 for projects falling under any of the following subparagraph:

1. Survey of new and renewable energy resources and demand for new and renewable energy technology, and compilation of statistics thereon;

2. Research, development, and technological assessment of new and renewable energy;

3. Certification and subsequent management of structures using new and renewable energy;

4. Support for establishing responsibility for the supply of new and renewable energy;

5. Performance assessment, certification, and subsequent management of new and renewable energy facilities;

6. Collection, analysis, and provision of technological information on new and renewable energy;

7. Guidance, education, and publicity on new and renewable energy technology;

8. Fostering of a specialized college and a research center for core technology in the field of new and renewable energy;

9. Training of experts in the field of new and renewable energy;

10. Support for companies that specialize in installing new and renewable energy facilities;

11. Pilot and diffusion projects for new and renewable energy;

12. Support for establishing responsibility for the use of new and renewable energy;

13. International cooperation on new and renewable energy;

14. Support for international standardization of new and renewable energy technology;

15. Support for common use of new and renewable energy facilities and components; and

16. Other projects necessary for the technological development, use, and diffusion of new and renewable energy prescribed by Presidential Decree. [This Article Wholly Amended, Apr. 12, 2010]

208 Ministry of Government Legislation

[Enforcement date: Apr. 13, 2011] subparagraph 3 of Article 10 [Enforcement date: Jan. 1, 2012] subparagraph 4 of Article 10 Article 11 (Execution of Projects)

(1) The Minister of Knowledge Economy may, where he/she deems it necessary to efficiently carry out the projects under the subparagraphs of Article 10, enter into agreements with entities falling under any of the following subparagraphs, and have such entities undertake such projects:

1. Specific research institutions under the Support of Specific Research Institutes Act;

2. Research institutes attached to companies under the Technology Development Promotion Act;

3. Industrial technology research cooperatives under the Act on the Support of the Industrial Technology Research Cooperatives;

4. Universities or junior colleges under the Higher Education Act;

5. State or public research institutes;

6. State agencies, local governments, and public institutions; and

7. Other entities recognized by the Minister of Knowledge Economy as competent to perform technological development.

(2) The Minister of Knowledge Economy may contribute all or part of the funds required for technological development or projects for use or diffusion executed by an entity falling under any subparagraph of paragraph (1).

(3) Matters necessary for the payment, use, management, etc. of the contribution under paragraph (2) shall be prescribed by Presidential Decree. [This Article Wholly Amended, Apr. 12, 2010]

Article 12 (Investment Recommendation in New and Renewable Energy Projects and Establishing Responsibility for Use of New and Renewable Energy) (1) Where the Minister of Knowledge Economy deems it necessary to promote the technological development, use, and diffusion of new and renewable energy, he/she may recommend an entity engaged in an energy business to operate, invest in, or contribute to the business under any subparagraph of Article 10. (2) The Minister of Knowledge Economy may, where deemed necessary for promoting the use and diffusion of new and renewable energy and facilitating the new and renewable energy industry with regard to the structures that are newly built, expanded, Laws on Green Growth, and Economic Investment in Korea 209 04_LawsConcerningGreenGrowth

or remodeled by an entity falling under any of the following subparagraphs, require such entities to install new and renewable energy facilities to use energy produced using new and renewable energy for a certain percentage or more of the quantity of energy to be used as projected at the time of design, as prescribed by Presidential Decree:

1. State and local governments;

2. Public corporations under Article 5 of the Act on the Management of Public Institutions (hereinafter referred to as "public corporations");

3. Government-funded institutions to which the State has contributed not less than the amount prescribed by Presidential Decree;

4. Government-invested corporations under subparagraph 6 of Article 2 of the State Properties Act;

5. Corporations to which a local government, or a public corporation, a government-funded institution or a government-invested corporation under subparagraphs 2 through 4 contributed at a ratio or amount not less than that prescribed by Presidential Decree; and

6. Corporations established under a special Act. (3) The Minister of Knowledge Economy may recommend that any factory, business place, collective housing complex, etc., which is deemed adequate to use new and renewable energy in consideration of the conditions to use new and renewable energy, use new and renewable energy as designated by him/her or install the appropriate facilities. [This Article Wholly Amended, Apr. 12, 2010]

Article 12-2 (Certification, etc. of Structures Using New and Renewable Energy) (1) Any entity which owns a structure not smaller than a certain scale prescribed by Presidential Decree may obtain certification for it as a structure using new and renewable energy (hereinafter referred to as "certification of structure"), which means that it uses energy supplied by using new and renewable energy for a certain percentage or more of the total energy used, from an agency designated by the Minister of Knowledge Economy (hereinafter referred to as "agency for certification of structure"). (2) Any entity that intends to obtain certification of structure under paragraph (1) shall file an application with the agency for certification of structure. (3) The Minister of Knowledge Economy may designate an entity qualified to grant certification of structure, from among the new and renewable energy center under 210 Ministry of Government Legislation

Article 31 and other entities that engage in businesses for technological development, use, and diffusion of new and renewable energy, as an agency for certification of structure.

(4) The agency for certification of structure shall, upon receipt of an application for certification under paragraph (2), examine it pursuant to the criteria for certification examination set forth by Joint Ordinance of the Ministry of Knowledge Economy and the Ministry of Land, Transport and Maritime Affairs, and thereafter, grant certification to the structure if it satisfies the applicable criteria. (5) The Minister of Knowledge Economy may provide preferential treatment to entities with certification of structure in pursuing diffusion projects under Article 27 (1). (6) The scope of duties, certification procedures, follow-up management of certification of structure of the agency for certification of structure, designation procedures for certification of structure, follow-up management of certification of structure, and other matters necessary for certification of structure shall be prescribed by Joint Ordinance of the Ministry of Knowledge Economy and the Ministry of Land, Transport, and Maritime Affairs.

[This Article Newly Inserted, Apr. 12, 2010]

Article 12-3 (Indication, etc. of Certification of Structure) (1) Any entity that has obtained certification of structure under Article 12-2 may either display the certificate on the certified structure or give public notice of the certification. (2) No entity that has failed to obtain certification of structure shall display or indicate certification of structure under paragraph (1) or make any indication similar thereto, or give any public notice to the effect of having received such certification. [This Article Newly Inserted, Apr. 12, 2010]

Article 12-4 (Revocation of Certification of Structure) The agency for certification of structure shall, when any entity has obtained certification of structure falling under any of the following subparagraphs, revoke such certification: Provided that the certification shall be revoked when falling under subparagraph 1:

1. When the entity has obtained the certification by falsification or other illegal means;

2. When the entity returns the certification to the agency for certification of structure;

3. When approval for use of the structure with the certification is revoked; and

4. When the structure with the certification is found to not fulfill the criteria for Laws on Green Growth, and Economic Investment in Korea 211 04_LawsConcerningGreenGrowth

certification examination under Article 12-2 (4). [This Article Newly Inserted, Apr. 12, 2010]

Article 12-5 (Establishing Responsibility for Supply of New and Renewable Energy, etc.)

(1) Where the Minister of Knowledge Economy deems it necessary to promote use and diffusion of new and renewable energy and facilitate the new and renewable energy industry, he/she may require an entity prescribed by Presidential Decree from among those falling under any of the following subparagraphs (hereinafter referred to as "entity with responsibility to supply") to supply a certain or larger amount of power generation with new and renewable energy:

1. An operator of an electric power generation business under Article 2 of the Electric Business Act;

2. An entity deemed to have acquired a license to run an electric power generation business under Article 7 (1) of the Electricity Business Act in accordance with Articles 9 and 48 of the Integrated Energy Supply Act; and

3. Public institutions; (2) The total quantity of power that an entity with responsibility to supply should mandatorily supply by new and renewable energy under paragraph (1) (hereinafter referred to as "mandatory supply quantity") shall be annually prescribed by Presidential Decree within 10% of the quantity of total power generation. With regard to the kinds of new and renewable energy that require balanced use and diffusion, part of the total mandatory supply quantity may be supplied using the appropriate kind of new and renewable energy as prescribed by Presidential Decree. (3) The mandatory supply quantity of an entity with responsibility to supply shall be prescribed and publicly announced by the Minister of Knowledge Economy for each responsible entity after hearing the opinions of the responsible entities. The Minister of Knowledge Economy shall consider the total amount of power generation of responsible entities, sources of power generation, etc. (4) Responsible entities may defer their responsibility to supply in the following year as part of their mandatory supply quantity as prescribed by Presidential Decree. The mandatory supply quantity deferred shall be supplied first during the following year. (5) Responsible entities may meet the mandatory supply quantity by purchasing supply certification of new and renewable energy under Article 12-7. 212 Ministry of Government Legislation

(6) To confirm implementation of the responsibility to supply under paragraph (1), the Minister of Knowledge Economy may require the responsible entity to provide necessary data as prescribed by Presidential Decree or to present supply certification of new and renewable energy, which is purchased and used to satisfy the mandatory supply quantity under Article 5 or is issued under Article 12-7 (1). [This Article Newly Inserted, Apr. 12, 2010]

Article 12-6 (Penalty for Failure to Supply New and Renewable Energy) (1) Where the responsible entity fails to fully supply the mandatory supply quantity with new and renewable energy, the Minister of Knowledge Economy may impose a penalty up to an amount calculated by multiplying the appropriate year's average transaction price of supply certification of new and renewable energy under Article 12-7 by 150/100, for the shortage, as prescribed by Presidential Decree. (2) A responsible entity that has paid a penalty under paragraph (1) shall be regarded as having supplied the mandatory supply quantity of the period for which the penalty was imposed.

(3) If an entity levied with a penalty under paragraph (1) fails to pay it on or before the deadline for payment, the Minister of Knowledge Economy shall collect it in accordance with the precedents for dispositions on default of national taxes. (4) Any penalty collected under paragraphs (1) and (3) shall be reverted to the financial resources of the Electrical Industry Foundation Fund under the Electricity Business Act.

[This Article Newly Inserted, Apr. 12, 2010]

Article 12-7 (Supply Certification of New and Renewable Energy) (1) Any entity that supplies energy using new and renewable energy (hereinafter referred to as "supplier of new and renewable energy") may obtain certification for such supply (including certification in an electronic format; hereinafter referred as "supply certification") from an agency designated by the Minister of Knowledge Economy for certification of energy supply using new and renewable energy, etc. (hereinafter referred to as "supply certification agency"): Provided, that where State assistance prescribed by Presidential Decree is received such as subsidy for price differences under Article 17 or assistance for new and renewable energy facilities, issuance of supply certification may be restricted as prescribed by Presidential Decree. (2) Any entity who intends to obtain supply certification shall file an application with Laws on Green Growth, and Economic Investment in Korea 213 04_LawsConcerningGreenGrowth

the supply certification agency, as prescribed by Presidential Decree. (3) The supply certification agency shall, upon receipt of an application under paragraph (2), check the supply quantity of each source of new and renewable energy, supply period, etc. and issue supply certification including the details of each of the following subparagraphs. With regard to the types of new and renewable energy that requires balanced use and diffusion, promotion of technical development, etc., supply certification may be issued with a supply quantity that is the actual supply quantity multiplied by a weight, as prescribed by Presidential Decree:

1. Supplier of new and renewable energy;

2. Supply quantity and period of each source of new and renewable energy; and

3. Validity period. (4) The validity period of supply certification shall be three years from its issuance date, but supply certification purchased by an entity responsible to supply in order to satisfy the mandatory supply quantity or supply certification received and presented by such entity to the Minister of Knowledge Economy pursuant to Article 12-5 (5) and (6) shall lose its validity. In such cases, expired or invalid supply certification shall be discarded.

(5) For an entity that has received supply certification to trade, it shall do so in a trade market established by a supply certification agency as prescribed by the provisions on the issuance of supply certification and operation of a trade market under Article 12-9 (2) (hereinafter referred to as "trade market"). (6) When supply certification falls under any of the grounds prescribed by Ordinance of the Ministry of Knowledge Economy such as supply certification issued for supplying energy by using a certain or larger scale of water power, the Minister of Knowledge Economy may prevent such supply certification from being traded in consideration of fairness with other types of new and renewable energy. [This Article Newly Inserted, Apr. 12, 2010]

Article 12-8 (Designation of Supply Certification Agency, etc.) (1) The Minister of Knowledge Economy shall designate as the supply certification agency, an entity falling under any of the following subparagraphs to handle supply certification tasks in a professional and efficient manner and ensure fair transactions in supply certifications:

1. The new and renewable energy center under Article 31; 214 Ministry of Government Legislation

2. Korea Power Exchange under Article 35 of the Electricity Business Act; and

3. Any entity that satisfies the criteria prescribed by Presidential Decree including those for human resources, technical capacity, facilities, equipment, etc. required in handling the tasks of the supply certification agency under Article 12-9. (2) Any entity that intends to be designated as a supply certification agency pursuant to paragraph (1) shall file an application with the Minister of Knowledge Economy. (3) The methods and procedures of designation of a supply certification agency and other matters necessary for such designation shall be prescribed by Ordinance of the Ministry of Knowledge Economy.

[This Article Newly Inserted, Apr. 12, 2010]

Article 12-9 (Tasks of Supply Certification Agency, etc.) (1) The supply certification agency designated pursuant to Article 12-8 shall carry out the tasks under each of the following subparagraphs:

1. Issuance, registration, management, and disposal of supply certification;

2. Opening of a trade market;

3. Providing information on supply certification; and

4. Other tasks related to issuance and trade of supply certification. (2) Before going into operation, the supply certification agency shall draft a rule on issuance of supply certification and operation of a trade market (hereinafter referred to as "operation rule") and have it approved by the Minister of Knowledge Economy as prescribed by Ordinance of the Ministry of Knowledge Economy. The same shall apply to amendment or repeal of the operation rule (excluding any alteration to trivial matters prescribed by Ordinance of the Ministry of Knowledge Economy). (3) The Minister of Knowledge Economy may order the supply certification agency to report on the plan and results of the tasks under paragraph (1) or demand submission of data.

(4) The Minister of Knowledge Economy may order the public certification agency falling under any of the following subparagraphs to take a corrective measure by a specific deadline:

1. Where it fails to observe an operation rule;

2. Where it fails to make a report under Paragraph (3) or makes a false report; and

3. Where it fails to comply with a demand for submission of data under paragraph Laws on Green Growth, and Economic Investment in Korea 215 04_LawsConcerningGreenGrowth

(3) or submits false data.

[This Article Newly Inserted, Apr. 12, 2010]

Article 12-10 (Revocation of Designation as Supply Certification Agency, etc.) (1) The Minister of Knowledge Economy shall revoke the designation of the supply certification agency if it falls under any of the following subparagraphs or order it to suspend all or part of its business for a period of up to one year as prescribed by Ordinance of the Ministry of Knowledge Economy: Provided, that if it falls under subparagraph 1 or 2, the designation shall be revoked:

1. Where the designation was obtained by falsification or other fraudulent means;

2. Where the agency continues to carry out business during a business suspension;

3. Where the agency no longer satisfies the designation criteria under Article 12-8 (1) 3; and

4. Where the agency fails to execute a correction order under Article 12-9 (4) by the deadline.

(2) If the supply certification agency falls under paragraph (1) 3 or 4 and is subject to a business suspension but such suspension is likely to cause serious inconvenience to its users, etc. or harm the public interest, the Minister of Knowledge Economy may charge a penalty not exceeding 50 million won instead of ordering a business suspension.

(3) The amounts of penalties to be imposed depending upon the types and severity of offences subject to penalties under paragraph (2), and other necessary matters shall be prescribed by Presidential Decree.

(4) If an entity charged with a penalty under paragraph (2) fails to pay such penalty on or before the deadline for payment, the Minister of Knowledge Economy shall collect it in accordance with the precedents for the disposition on default of national taxes.

[This Article Newly Inserted, Apr. 12, 2010]

Article 13 (Certification, etc. of New and Renewable Energy Facilities) (1) Any entity that intends to manufacture or import and sell new and renewable energy facilities may obtain certification for such new and renewable energy facilities (hereinafter referred to as "certification of facilities") from an agency designated by the Minister of Knowledge Economy for certification of new and renewable energy 216 Ministry of Government Legislation

facilities (hereinafter referred to as "agency for certification of facilities"). (2) Any entity that intends to obtain certification for new and renewable energy facilities under paragraph (1) shall file an application with the agency for certification of facilities.

(3) When an entity applies for certification of facilities under paragraph (2), it shall undergo a performance evaluation by the performance evaluation agency as designated by the Minister of Knowledge Economy pursuant to the designation criteria prescribed by Presidential Decree (hereinafter referred to as "performance evaluation agency"), and submit to the agency for certification of facilities the written performance evaluation results issued by the performance evaluation agency. (4) The Minister of Knowledge Economy shall designate, as an agency for certification of facilities, the new and renewable energy center under Article 31 or an entity that is deemed qualified to grant certification from among entities engaged in facilitating technical development, use, and diffusion of new and renewable energy. (5) The agency for certification of facilities shall, upon receipt of an application for certification of facilities under paragraph (2), examine it pursuant to the criteria for certification examination set forth by Ordinance of the Ministry of Knowledge Economy, based upon the written performance evaluation results issued by the performance evaluation agency, and thereafter, shall grant certification to the new and renewable energy facilities satisfying the applicable criteria. (6) The scope of duties of the agency for certification of facilities, certification procedures, subsequent management of certification of facilities, the designation procedures for the performance evaluation agency, and other matters necessary for certification of facilities shall be prescribed by Ordinance of the Ministry of Knowledge Economy. (7) The Minister of Knowledge Economy may partially subsidize expenses incurred in the performance evaluation under paragraph (3) or provide the agency for certification of facilities designated under paragraph (4) with administrative support, etc. within the scope necessary to achieve the purpose of designation, as prescribed by Ordinance of the Ministry of Knowledge Economy.

[This Article Wholly Amended, Apr. 12, 2010]

Article 14 (Indication, etc. of Certification of New and Renewable Energy Facilities)

(1) Any entity that has obtained certification of facilities under Article 13 may either display this certification on the appropriate new and renewable energy facilities or Laws on Green Growth, and Economic Investment in Korea 217 04_LawsConcerningGreenGrowth

give public notice of receipt of the certification. (2) No entity that has failed to obtain certification of facilities shall display or indicate certification of facilities under paragraph (1) or make any indication similar thereto, or give any public notice to the effect of having obtained such certification. [This Article Wholly Amended, Apr. 12, 2010]

Article 15 (Revocation of Certification of Facilities and Revocation of Designation of Performance Evaluation Agency)

(1) The agency for certification of facilities shall, when any entity has obtained certification of facilities by falsification or other fraudulent means, revoke such certification, and if it discovers that any new and renewable energy facilities, which have been manufactured or imported and sold after obtaining certification, fail to satisfy the certification examination criteria under Article 13 (5), it may revoke such certification. (2) The Minister of Knowledge Economy shall, when the performance evaluation agency falls under any of the following subparagraphs, either revoke such designation as prescribed by Presidential Decree or issue an order to suspend all or part of business for a period of up to one year: Provided, that in cases falling under subparagraph 1, he/she shall revoke such designation:

1. When it obtained the designation by falsification or other illegal means;

2. When it has failed to commence the performance evaluation business within one year from the date of obtaining the designation without any justifiable grounds, or suspended the performance evaluation business for not less than one consecutive year; and

3. When it no longer satisfies the designation criteria in accordance with Article 13 (3).

[This Article Wholly Amended, Apr. 12, 2010]

Article 16 (Fees)

(1) The agency for certification of structure, the agency for certification of facilities, or the performance evaluation agency may charge a fee to any entity that applies for certification of structure, certification of facilities, or performance evaluation, as set forth by Ordinance of the Ministry of Knowledge Economy. (2) The supply certification agency may charge a fee to any entity that applies for issuance of supply certification or trades supply certification as set forth by Ordinance of the 218 Ministry of Government Legislation

Ministry of Knowledge Economy.

[This Article Wholly Amended, Apr. 12, 2010]

[Enforcement date: Apr. 13, 2011] Article 16 (1)

[Enforcement date: Jan. 1, 2012] Article 16 (2)

Article 17 (Public Notification of Standard Price for New and Renewable Energy Power Generation and Subsidization of Differences) (1) When prescribing the standard price of electricity supplied by new and renewable energy power generation by source for electricity generation, the Minister of Knowledge Economy shall notify the public of such. The calculation criteria for the standard price shall be prescribed by Presidential Decree. (2) The Minister of Knowledge Economy shall, where the power trade price of electricity supplied by new and renewable energy power generation (referring to the transaction price of electricity under Article 33 of the Electric Business Act) is lower than the standard price that the public was notified of under paragraph (1), give preferential subsidies from the Electrical Industry Foundation Fund under Article 48 of the Electric Business Act for the difference between the standard price and the power trade price (hereinafter referred to as "power generation price difference") to an operator of a new and renewable energy power generation business that has supplied the electricity. (3) The Minister of Knowledge Economy may, when notifying the public of the standard price in accordance with paragraph (1), make public notice of the period of subsidization for the power generation price difference. (4) The Minister of Knowledge Economy may request an operator of a new and renewable energy power generation business that is subsidized for the power generation price difference to submit data necessary to establish the standard price, such as financial statements.

[This Article Wholly Amended, Apr. 12, 2010]

[This Article shall be effective until December 31, 2012 in accordance with the provisions of Article 2 (1) of the Addenda of Act No. 10253 (Apr. 12, 2010)] Article 18 (Suspension of Subsidies, etc.)

(1) Where an operator of a new and renewable energy power generation business that is subsidized for the power generation price difference falls under any of the following subparagraphs, the Minister of Knowledge Economy may issue a warning or corrective Laws on Green Growth, and Economic Investment in Korea 219 04_LawsConcerningGreenGrowth

order as set forth by Ordinance of the Ministry of Knowledge Economy, and suspend the subsidies for an entity that fails to comply therewith:

1. When it has obtained subsidy for the power generation price difference by fraud or other illegal means; and

2. When it has failed to comply with a request for the submission of data pursuant to the provisions of Article 17 (4) or has submitted false data. (2) Where an operator of a new and renewable energy power generation business that is subsidized for the power generation price difference falls under paragraph (1) 1, the Minister of Knowledge Economy may recover subsidies as set forth by Ordinance of the Ministry of Knowledge Economy. In such cases, if an entity subject to repayment of the power generation price difference fails to repay it within 30 days, the Minister of Knowledge Economy may collect it in accordance with the precedents for dispositions on default of national taxes.

[This Article Wholly Amended, Apr. 12, 2010]

Article 19 (Application for Ruling)

An operator of a new and renewable energy power generation business may apply for a ruling to the Electrical Affairs Commission under Article 53 of the Electric Business Act where it fails to reach an agreement with an operator of an electric transmission business under subparagraph 6 of Article 2 of the same Act or an operator of an electric distribution business under subparagraph 8 of the same Article of the same Act or where it finds it difficult to reach an agreement with an operator in supplying electricity generated by new and renewable energy power generation through the facilities for transmission or distribution to the Korea Power Exchange under Article 35 of the same Act or electricity users.

[This Article Wholly Amended, Apr. 12, 2010]

Article 20 (Support for International Standardization of New and Renewable Energy Technology)

(1) The Minister of Knowledge Economy may extend support necessary for laying the foundation for standardization, international activities, and such to the agency for certification of facilities so that new and renewable energy technologies already developed or still being developed domestically may conform to the international standards under subparagraph 2 of Article 3 of the Framework Act on National Standards.

220 Ministry of Government Legislation

(2) Necessary matters regarding the scope of support, etc. under paragraph (1) shall be set forth by Presidential Decree.

[This Article Wholly Amended, Apr. 12, 2010]

Article 21 (Common Use of New and Renewable Energy Facilities and Components)

(1) The Minister of Knowledge Economy may designate and operate new and renewable energy facilities and components as common items in order to improve their compatibility as determined and announced by the Minister of Knowledge Economy. (2) An entity that falls under any of the following subparagraphs may request the Minister of Knowledge Economy to designate some items that need to be put to common use, from among new and renewable energy facilities and components, as common items:

1. The new and renewable energy center under Article 31; and

2. Other institutions or organizations designated by Ordinance of the Ministry of Knowledge Economy.

3. The Minister of Knowledge Economy may provide necessary support to efficiently put new and renewable energy facilities and components to common use.

4. Necessary matters regarding the designation and operation of new and renewable energy facilities and components as common items, request for designation, criteria for support, etc. under paragraphs (1) through (3) shall be set forth by Presidential Decree.

[This Article Wholly Amended, Apr. 12, 2010]

Article 22 (Reporting of Companies Specialized in Installing New and Renewable Energy Facilities, etc.)

(1) An entity that intends to specialize in installing new and renewable energy facilities (hereinafter referred to as "specialized enterprise of new and renewable energy facilities") shall make a report to the Minister of Knowledge Economy regarding capital, technology personnel, etc. pursuant to the reporting criteria and procedures set forth by Presidential Decree.

(2) The Minister of Knowledge Economy shall, when a specialized enterprise of new and renewable energy facilities makes a report to him/her under paragraph (1), immediately issue a report certificate as set forth by Ordinance of the Ministry of Knowledge Economy.

Laws on Green Growth, and Economic Investment in Korea 221 04_LawsConcerningGreenGrowth

(3) The Minister of Knowledge Economy may, when he/she deems it necessary for the diffusion project under Article 27, extend support to a specialized enterprise of new and renewable energy facilities, in such ways as partially subsidizing the expenses incurred in the installation and maintenance of new and renewable energy facilities, as prescribed by Presidential Decree.

[This Article Wholly Amended, Apr. 12, 2010]

Article 23 Deleted

Article 24 (Hearings)

In order to impose a disposition under any of the following subparagraphs, the Minister of Knowledge Economy shall hold a hearing:

1. Revocation of designation of a supply certification agency under Article 12-10 (1); and

2. Revocation of designation of a performance evaluation agency under Article 15 (2). [This Article Wholly Amended, Apr. 12, 2010]

Article 25 (Compilation of Related Statistics, etc.) (1) The Minister of Knowledge Economy may research, compile, analyze, and manage statistics regarding the supply and demand of new and renewable energy at home and abroad, necessary for efficient formulation and implementation of the policies related to new and renewable energy including the basic plan under Article 5 and the implementation plan under Article 6, and may request data and information necessary therefor from the entities under Article 11 (1) or producers, installers, and users of the new and renewable energy facilities. (2) The Minister of Knowledge Economy may designate a specialized institution to fully or partially perform research, compilation, analysis, and management of statistics under paragraph (1) as set forth by Ordinance of the Ministry of Knowledge Economy. [This Article Wholly Amended, Apr. 12, 2010]

Article 26 (Lease, etc. of State or Public Properties) (1) The State or a local government may, where deemed necessary for projects for the technological development, use, and diffusion of new and renewable energy, enter into a lease contract on or give permission to use (hereinafter referred to as "lease") 222 Ministry of Government Legislation

in the form of a private contract, or dispose of a State or public property to entities conducting projects for the technological development, use, and diffusion of new and renewable energy, notwithstanding the provisions of the State Properties Act or the Public Property and Commodity Management Act.

(2) Where the State or a local government leases out a State or public property pursuant to paragraph (1), it may allow construction of a permanent facility with a condition of voluntary demolition and deposit of demolition expenses, notwithstanding the provisions of the State Properties Act or the Public Property and Commodity Management Act: Provided, that for construction of a permanent facility on a public property, agreement shall be acquired by a local assembly pursuant to the procedures prescribed by Municipal Ordinance.

(3) The term of lease of a State or public property under paragraph (1) shall not exceed ten years. That of a State property may be renewed for a term not exceeding the term of the previous lease, and that of a public property may, when deemed necessary by the head of a local government, be extended once for not exceeding ten years. (4) When an entity that has purchased or leased a State or public property under paragraph (1) fails to carry out a project for technological development, use, and diffusion of new and renewable energy on the property within two years from the date of such purchase or lease, the lease contract or permission to use may be revoked or the property may be repurchased.

[This Article Wholly Amended, Apr. 12, 2010]

Article 27 (Diffusion Project)

(1) The Minister of Knowledge Economy may, where he/she deems it necessary for promoting the use and diffusion of new and renewable energy, execute each of the following diffusion projects as prescribed by Presidential Decree:

1. Application projects and pilot projects of new technology;

2. Projects to form environmentally-friendly new and renewable energy clusters and pilot complexes;

3. Diffusion projects carried out in collaboration with local governments;

4. Projects supporting the diffusion of new and renewable energy facilities put to practical use; and

5. Other projects necessary for the promotion of use and diffusion of new and renewable energy technologies determined by the Minister of Knowledge Economy. Laws on Green Growth, and Economic Investment in Korea 223 04_LawsConcerningGreenGrowth

(2) The Minister of Knowledge Economy may give priority to the implementation of diffusion projects under paragraph (1) where certification of facilities is obtained for developed new and renewable energy facilities, new and renewable energy technology is internationally standardized, or new and renewable energy facilities and components are put to common use.

(3) The head of the appropriate central administrative agency may provide cooperation necessary for improving the environment and promoting the diffusion of new and renewable energy.

[This Article Wholly Amended, Apr. 12, 2010]

Article 28 (Commercialization of New and Renewable Energy Technology) (1) The Minister of Knowledge Economy may provide the following support, when deemed necessary for promoting the commercialization of technology developed independently or through the subsidization of projects under Article 10:

1. Lending of funds required for producing prototypes and investment in facilities;

2. Gratuitous concession of industrial property rights acquired by the State through development projects for new and renewable energy technology;

3. Education and publicity of developed new and renewable energy technology; and

4. Other support projects deemed necessary for commercialization of developed new and renewable energy technology and determined by the Minister of Knowledge Economy.

(2) The subjects, scope, conditions, and procedures for support under paragraph (1) or other necessary matters shall be set forth by Ordinance of the Ministry of Knowledge Economy.

[This Article Wholly Amended, Apr. 12, 2010]

Article 29 (Financial Measures, etc.)

The State shall take necessary measures, such as providing financial or tax support, where it is necessary, to an entity that is recommended pursuant to Article 12 or that must comply with duties, an entity engaged in the technological development, use, and diffusion of new and renewable energy, or an entity that has obtained certification of facilities under Article 13.

[This Article Wholly Amended, Apr. 12, 2010]

224 Ministry of Government Legislation

Article 30 (Education and Publicity on New and Renewable Energy, and Fostering of Experts)

(1) The State shall endeavor to seek understanding and cooperation from the public with regard to the technological development, use, and diffusion of new and renewable energy, through education and publicity.

(2) The Minister of Knowledge Economy may designate, foster and support a specialized college and a research center for core technology in the field of new and renewable energy for the purpose of nurturing experts in the field of new and renewable energy. [This Article Wholly Amended, Apr. 12, 2010]

Article 31 (New and Renewable Energy Center)

(1) The Minister of Knowledge Economy may establish a new and renewable energy center (hereinafter referred to as "Center") under an energy agency prescribed by Presidential Decree, in order to professionally and efficiently promote the use and diffusion of new and renewable energy, and may have the Center perform the projects falling under each of the following subparagraphs:

1. Support and management of entities that execute projects to technically develop, use and diffuse new and renewable energy under Article 11 (1);

2. Support and management of certification of structure under Article 12-2;

3. Support and management of the tasks of the supply certification agency under Article 12-9;

4. Support and management of certification of facilities under Article 13;

5. Technological support for new and renewable energy facilities already diffused;

6. Support and management of the international standardization of new and renewable energy technology under Article 20;

7. Support and management of the common use of new and renewable energy facilities and components under Article 21;

8. Support and management of a specialized enterprise of new and renewable energy facilities under Article 22;

9. Management of statistics under Article 25;

10. Support and management of the diffusion project for new and renewable energy under Article 27;

11. Support and management of the commercialization of new and renewable energy Laws on Green Growth, and Economic Investment in Korea 225 04_LawsConcerningGreenGrowth

technology under Article 28;

12. Support and management of education, publicity, and nurturing of experts under Article 30(1);

13. Projects for domestic and overseas investigation, research and international cooperation for new and renewable energy;

14. Projects incidental to those under subparagraphs 1 through 6; and

15. Other projects required for the promotion of use and diffusion of new and renewable energy, which are entrusted by the Minister of Knowledge Economy. (2) The Minister of Knowledge Economy may, when the Center executes projects under paragraph (1), provide fund contributions and other necessary support thereto. (3) Matters necessary for the organization, staffing, budget, and operation of the Center shall be set forth by Ordinance of the Ministry of Knowledge Economy. [This Article Wholly Amended, Apr. 12, 2010]

[Enforcement date: Apr. 13, 2011] Article 31 (1) 2 [Enforcement date: Jan. 1, 2012] Article 31 (1) 3 Article 32 (Delegation and Entrustment of Authority) (1) Part of the authority of the Minister of Knowledge Economy under this Act may be delegated to the head of any institution under his/her control, the Special Metropolitan City Mayor, Metropolitan City Mayors, or Do (province) Governors (hereinafter referred to as "Mayor/Do Governor"), as prescribed by Presidential Decree. (2) Part of the duties of the Minister of Knowledge Economy or Mayor/Do Governor under this Act may be entrusted to the Center or the Korea Institute of Energy Technology Evaluation and Planning under Article 13 of the Energy Act as prescribed by Presidential Decree.

[This Article Wholly Amended, Apr. 12, 2010]

Article 33 (Legal Fiction as Public Official in Applying Penal Provisions) Any person falling under any of the following subparagraphs shall be deemed a public official in applying Articles 129 through 132 of the Criminal Act.

1. Any officer or employee of an agency for certification of structure engaged in the duties of certification of structure;

2. Any officer or employee of a supply certification agency engaged in the duties of 226 Ministry of Government Legislation

issuing and trading supply certification;

3. Any officer or employee of an agency for certification of facilities engaged in the duties of certification of facilities; and

4. Any officer or employee of a performance evaluation agency engaged in performance evaluation.

[This Article Wholly Amended, Apr. 12, 2010]

[Enforcement date: Apr. 13, 2011] subparagraphs 1, 3, and 4 of Article 33 [Enforcement date: Jan. 1, 2012] subparagraph 2 of Article 33 Article 34 (Penal Provisions)]

(1) Any person who obtains subsidy for the power generation price difference under Article 17 by falsification or other illegal means, or who knowingly provides it in spite of his/her knowledge of such fact shall be punished by imprisonment for a term not exceeding three years or a fine not exceeding three times the subsidized amount. (2) A person who obtained supply certification by falsification or other illegal means, or who knowingly issued it in spite of his/her knowledge of such fact shall be punished by imprisonment for a term not exceeding three years or a fine not exceeding 30 million won.

(3) A person who traded supply certification in a place other than a trade market established by a supply certification agency in violation of Article 12-7 (5) shall be punished by imprisonment for a term not exceeding two years or a fine not exceeding 20 million won.

(4) If a representative of a corporation, or an agent, employee or any other employed person of a corporation or an individual commits any violation under paragraphs (1) through (3) in connection with the affairs of the corporation or the individual, not only shall such the offender be punished accordingly, but the corporation or the individual shall be punished by a fine under the corresponding Articles: Provided, that the same shall not apply to cases where the corporation or the individual has exercised due care or diligently supervised the business in order to prevent such violation.

[This Article Wholly Amended, Apr. 12, 2010]

Article 35 (Fines for Negligence)

(1) Any person falling under any of the following subparagraphs shall be imposed a fine Laws on Green Growth, and Economic Investment in Korea 227 04_LawsConcerningGreenGrowth

for negligence not exceeding ten million won:

1. A person who has obtained certification of facilities by falsification or other illegal means;

2. A person who has indicated certification of structure or anything similar thereto or has given any public notice to the effect that he/she obtained certification, without obtaining any certification from the certification agency; and

3. A person who has indicated certification of facilities or anything similar thereto or has given any public notice to the effect that he/she obtained certification, without obtaining any certification from the certification agency. (2) Fines for negligence under paragraph (1) shall be imposed and collected by the Minister of Knowledge Economy as prescribed by Presidential Decree. [This Article Wholly Amended, Apr. 12, 2010]

ADDENDA

Article 1 (Enforcement Date)

This Act shall take effect on the date of its promulgation: Provided, that the amended provisions of Articles 5 (2) and 32 (2) shall take effect on April 14, 2010; the amended provisions of Articles 22 and 23 shall take effect three months after the promulgation date; the amended provisions of subparagraph 3 of Article 10, parts other than each subparagraph of Article 12 (2), Articles 12-2 through 12-4, 13, 15 (1), 16 (1), 20 (1), 31 (1) 2, and subparagraphs 1, 3, and 4 of Article 33 shall take effect one year after the promulgation date; and the amended provisions of subparagraph 4 of Article 10, Articles 12-5 through 12-10, 16 (2), subparagraph 1 of Article 24, Article 31 (1) 3, subparagraph 2 of Article 33, and Article 34 (2) and (3), and Article 5 of the Addenda shall take effect on January 1, 2012.

Article 2 (Application Deadline for Subsidization of Differences, etc.)

1. The provisions of Article 17 shall apply until December 31, 2011.

2. An operator of a new and renewable energy power generation business who is subsidized for the power generation price difference under the superseded Article 17 at the time when the validity of paragraph (1) expires shall continue to be subsidized for such in accordance with the previous provisions during the subsidization period announced under paragraph (3) of the same Article. 228 Ministry of Government Legislation

Article 3 (Applicable Example)

The amended provisions in the parts other than each subparagraph of Article 12 (2) shall apply, starting with the first structure that is newly built, expanded, or remodeled with approval for the project plan or permission for construction after the amended provisions in the parts other than each subparagraph of Article 12 (2) take effect pursuant to the proviso of Article 1 of the Addenda.

Article 4 (Transitional Measure concerning Specialized Enterprise of New and Renewable Energy Facilities)

Any entity registered as a specialized enterprise of new and renewable energy facilities under the superseded Article 22 (1) and (2) when the amended provisions of Article 22 take effect pursuant to the proviso of Article 1 of the Addenda shall be regarded as any entity who completed the report of a specialized enterprise of new and renewable energy facilities pursuant to the amended provisions of Article 22 (1) and (2).